empowering neighborhood revitalization: lessons for france from three u.s. cities

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© 2015 Te German Marshall Fund o the United States. All rights reserved.

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About the Author

Celine Gipoulon is a ormer project manager at the French National Agency or Urban Regeneration and was a 2013-14 Urban and

Regional Policy Fellow.

GMF Paper Series

Te GMF Paper Series presents research on a variety o transatlantic topics by staff, ellows, and partners o the German Marshall

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ments rom readers are welcome; reply to the mailing address above or by e-mail to [email protected].

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challenges and opportunities in the spirit o the Marshall Plan. GMF does this by supporting individuals and institutions working in

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Empowering Neighborhood Revitalization

Lessons for France from Three U.S. Cities

Celine Gipoulon

June 2015


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CONTENTS

Introduction 1 A Rising Interest for the U.S. Context 1

Bringing Lessons Back to France 1

Methodology 2

Overview of the Situation in France and the Interest in the Legacy City Examples 3

The PNRU: An Ambitious Public Policy but Limited Results in Certain Fields 3

Focusing on the United States: Why and How? 6

Three Neighborhood Revitalization Initiatives in the Rust Belt 11

Old North St. Louis: A Strong Community Organization 11

University Circle Cleveland: A Strong Foundation, Some Committed Partners 18

East Liberty Pittsburgh: A Strong Broad-Based City Leadership 25

Key Factors of the Rust Belt Approach: What are the Lessons for France? 33

Strengthening Community Organization in France 33

Developing Multi-Actor Place-Based Strategies 37

Establishing Philanthropic Organizations 39

Targeting (Channeling) Private Money to Neighborhood Needs 41

Preserving City-Wide Strategies 44

Conclusion 47

References 49

List of Interviews 51

Tax Incentive Mechanisms 53


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Empowering Neighborhood Revitalization | 1

Introduction

I

n early 2013, when I applied for GMF’s

Urban and Regional Policy Fellowship, the

10-year term of the National Program ofUrban Revitalization (PNRU) of the French

National Government that I was working for

was winding down and was subject to evalua-

tion in order to continue.

Since it was established in 2003, the PNRU

had embodied an ambitious public policy

toward neighborhood revitalization: massive

public investment, shared between national

and local levels in order to drastically change

the quality of life in disadvantaged neighbor-

hoods all over the country. I spent three years

there as a program manager, a go-between

between the national board and the other

municipal staff and elected ofcials in charge

of the program’s implementation. In this role,

I interacted with dozens of different cities and

many different types of actors, studied the

partnerships they were able to create, and

observed the way local communities were

considered and involved in the process.

As the program ended, a series of evaluationsand reports examined how to pursue this

public policy with better results. The main

assessment was that great physical transfor-

mations had been achieved but that the overall

socioeconomic impact in targeted neighbor-

hoods was insufcient. Both the program’s

top-down process meant that national, state,

and local governments collaborated to shape

the choices for neighborhoods, and the

predominance of public actors among the part-

nerships and funding sources were consid-

ered potential aws. If these two factors areimproved, the relationship between physical

transformation and socioeconomic change

could also be stronger.

A Rising Interest for the U.S. Context

Te comparative approach to urban policy isnot a new field. Many French sociologists andpolitical scientists have looked abroad in thelast 15 years, ocusing mainly on the notion

o empowerment. But as the time or reormcame, new government strategists took adeeper interest in this type o research. None-theless, practical research exploring how U.S.best practices could be adapted to the Frenchcontext was still limited, and it was suggestedthat there should be more comparative anal-ysis in this area.1

As I became more interested in U.S. examples, Iwas struck by the wide range o non-traditional

actors and unders listed in U.S. revitalizationprojects’ assets analysis. Tese kinds o localtailor-made solutions are much more devel-oped than in France. Meanwhile, the main-stream media had taken a growing interest inthe situation o Detroit, Michigan. As the city’sdecline led to a bankruptcy in July 2013, the

1 « Politiques de la Ville et Rénovation urbaine: perspectives inter-

nationales » (“Urban Policies and Urban Revitalization: international

perspectives”) Symposium by the Centre d’Analyse Stratégique,

think-tank of the prime minister December 12, 2012

ways that community-based initiatives andprivate-sector dynamics could take over moved

into the spotlight. I realized these kinds o citieshad resources that we do not have in France,despite lacking many things French cities enjoysuch as major public investment.

Bringing Lessons Back to France

Largely because o an increasing shortageo public unding, the ways other resources(human, technical, and financial) can besuccessully mobilized are o major interestto French practitioners and policymakers.Tis mobilization could help introduce newprocesses in the most disadvantaged neigh-borhoods, not only in terms o physicalimprovement but socially and economicallyas well, and in terms o civic involvement.My assumption was that an evolution towardbottom-up and more inclusive partnershipswould help French agencies improve thesocioeconomic impact o their policies.

I decided to ocus my research on the tools orinnovative, locally based public-private part-nerships. My aim was to learn rom three U.S.case studies: Cleveland, St. Louis, and Pitts-burgh. Do these partnerships rely entirely oncultural conditions? And what does this kind oplanning or urban transormation look like?

Second, I sought to understand how theselessons could be brought back to France.


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2 | The German Marshall Fund of the United States

What would French cities be like i differentactors were empowered to plan the utureo their neighborhoods and cities? Do thesesolutions only emerge when public authoritiesail to deal with the problems? Or are there

some patterns and conditions that could bebrought back to France?

Methodology

Te research ocuses on the participationo community-based organizations, privateactors, and non-profit organizations in therevitalization strategies o three neighbor-hoods. In order to learn more about how andwhy such strategies work in practice, my studyaddressed the ollowing research questions:

• How does the involvement o a diversityo actors influence the project definitionand process?

• What kind o governance acilitates aparticipatory planning process and howcould this arrangement be put in place?How do successul examples work atdifferent levels?

• What tools encourage better dialoguearound public-private partnerships (PPP)and crossed investments?

• Which models are adaptable to France,and, i so, under what conditions?

o answer these questions, I undertook aone-year research project based on three casestudies, ones in which multiple actors areworking together in a participatory plan-

ning process in a neighborhood, and wherethe local communities have been especiallyproactive in driving urban revitalization: OldNorth St. in St. Louis, Missouri; UniversityCircle in Cleveland, Ohio; and East Liberty in

Pittsburgh, Pennsylvania.2

As a 2014 urban and regional policy ellow,I travelled several times to these three citiesbetween the all o 2013 and spring o 2014.I went to each city two to three times orsuccessive stays o generally 7 to 10 days. Imet with stakeholders directly involved inthe neighborhoods’ transormations (mostlybut not exclusively community-based orga-nizations) and with other actors that were

involved in the cities’ affairs in general (cityplanning commissions, oundations, etc.) orrevitalization dynamics in general (includingacademics, private real estate developers, andphilanthropic oundations). Te ull list ointerviewees can be ound in Appendix 1.

I ocused on the project process, the partner-ships and the orm they took, the implicationsor local communities, and the incentives usedto encourage diverse participation. Direct

conversations with different stakeholdersallowed me understand their interests, theway they were involved in the process, andthe benefits they received rom this involve-ment. Interviewees were also invited to talk

2 These neighborhoods have been dened on an empirical basis,

referring rst to local perceptions. They do not necessarily rely on

political boundaries but they usually correspond to one or several

census tracts. It is worth noting that in the three cities, municipal-

ities, universities, and tourist websites use these neighborhoods

limits and names.

about the transerability o their practice andwhat they considered to be essential tools toimprove cities in general.

My methodology also included a brie review

o the literature about ederal policies, legis-lative rameworks, institutional contexts, andessential documentation about the chosensites. I wanted to deepen the analysis otargeted mechanisms or tools in order tostudy their applicability in France, beyond theofen-mentioned cultural differences, I alsoreviewed writings by French sociologists andpolitical scientists about U.S. urban policies.Te exhaustive reerences can be ound inAppendix 2.

Te report begins with an overview o themain challenges o French urban policy andthe reasons why initiatives rom so-called“legacy cities” could be o interest.

Te second section clarifies the differentprocesses in the three neighborhoods througha detailed description o the initiatives: theactors involved, their interaction, the strategythey ollowed, and their results. Each initia-tive is illustrated with the example o a key

ongoing or completed program.

Te third section summarizes the commoncharacteristics that account or the successo the studied examples and explores theconditions o their transerability in France.Some targeted policy recommendations orthe French context and or the reorm o thePNRU are included.


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Overview of the Situation in France and the Interest in the Legacy City Examples

The selection of three legacy cities may

appear like a paradoxical choice, as

their general physical condition canbe worse than that of French post-industrial

cities.3 Although many legacy city examples

do present some visible signs of success at

a neighborhood level, this research focuses

not on physical transformation but on the

processes that lead to new kind of solutions.

The United States is well known for its tradition

of empowerment. As legacy cities lost jobs and

major industries and their municipal govern-

ments were weakened, diverse actors have

stepped forward to initiate potentially trans-formative change. This is what makes them

interesting laboratories. In order to understand

which of these observations are transferable,

the following section explains the specics of

the French system of urban policy.

The PNRU: An Ambitious Public Policy

but Limited Results in Certain Fields

Te PNRU was launched in 2003 as a 10-year

program representing a new direction inFrench urban policy. Te objective was amassive public investment, at both nationaland local levels, to drastically change thequality o lie in disadvantaged neighborhoodsall over the country. Most o the program

3 In the U.S. context, legacy cities are cities that were once the

backbone of the United States’ industrial economy, but now face

signicant social and economic issues following the sustained loss of

jobs and population. These cities are clustered in New England, the

Mid-Atlantic, and the Midwest.

targeted “tower in the park” style projects builtoutside the city center and a ew inner-city

neighborhoods. One o the main goals wasto turn these long-segregated neighborhoodsinto “ordinary” ones through physical invest-ments developing mixed-uses and mixed-in-come housing. Te rationale was that manyo the handicaps residents experienced (e.g.,low levels o education and high unemploy-ment.) were accentuated by the isolation andintensity o poverty they endured, and thatenhancing their environment and bringing

diversity would help reduce their difficulties.Tough the French government has articu-lated different types o urban policies sincethe 1980s, this approach represents a rupturein several respects: the unprecedentedamount o investment (€13 billion o nationalpublic subsidies, generating €42 billiono global investment); the comprehensiveurban approach with a complete masterplanrequired or each area; and a simultaneousocus on hundreds o different neighborhoodsthroughout the country or at least a five-yearperiod. Compared with past programs, all othese were quite innovative and less heavilydedicated to the physical transormation othe neighborhoods.4

4 Popular especially from the 1950s to the 1970s, these are

commonly dened as high rises built within long blocks and

surrounded by tracts of green space. They are associated with failed

public housing projects.

While the PNRU has improved the livingconditions in several areas by transormingaffordable housing, developing new housingunits, offering new or renewed public ameni-ties, and shifing road access, it has been lesssuccessul in making the target areas more

economically and socially diverse and moreattractive or new residents, businesses, and jobs. Tis may explain why their socioeco-nomic indicators have not improved withinthe period. Te program is commonly judgedfirst to be too top-down, and second to betoo publicly driven and publicly unded.Tis suggests that i goals or residential andeconomic diversity are not met, it might be

Figure 1

There are hundreds of concerned neighbor-

hoods all around France.

source: ANRU


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because other actors able to encourage suchdynamics are not involved in the right way.In particular, the strategy has ofen beencompromised by the inability to ully engagethe “non-public” sector in the planning

process. It has become a priority or Frenchurban planners to explore new ideas orapproaches that might make our policies moreeffective.

Physical Interventions with Limited

Leverage on Socioeconomic IndicatorsIn the PNRU, decision-making over whichneighborhoods to target was determinedby a host o socioeconomic data, includingunemployment rate, percentage o migranthouseholds and o young people, and levelo education. Te PNRU was based on acompetitive grant or redevelopment projectslocated in these areas with quite an exclusivephysical approach. Interventions on the builtenvironment have taken many different orms,including housing rehabilitation and recon-figuration, demolition, transers o landown-ership, and new developments dedicated tohousing, new business, and amenities. Tese

projects were supposed to bring more visitors,residents, employers, and investors to theselong-segregated neighborhoods, which wouldin turn transorm them into mixed-used andmixed-income areas with new economicopportunities while pushing their socioeco-nomic indicators closer to their cities’ averagerates.

At the same time, another program run byanother public agency (ACSE — Agence pourla Cohésion Sociale et l’Egalité des chances)was in charge o giving annual public subsi-dies to local associations with the condition oco-unding rom municipal authorities. Tesesubsidies were dedicated to social issues suchas education, employment, culture, sports,and arts. Tis approach was not coordinatedwith the PNRU.

Tough the PNRU and ACSE led to somephysical improvements in specific neighbor-

hoods as a result o new public amenitiesand the success o a ew business relocationinitiatives, official sources show that bothprograms have had a low impact on the maineconomic indicators in the designated areas.5 In those areas, poverty actually increased by1.3 percent between 2008 and 2013 and is sti llmuch higher than in surrounding neighbor-

5 cf. “Rapport annuel de l’ONZUS 2013 — annual report of the

Observatory of Disadvantaged Neighborhoods (Zones Urbaines

Sensibles — ZUS).” Ten years after the ZUS’ creation, the report

shows that the gap between these neighborhoods and the rest of the

cities has increased during the past year.

Figure 2

Basic framework of the PNRU organization (2003-2013)


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organizational ramework, the mayor is the

point person at the local level, speaking orall other partners in the dialogue with thenational government and its agencies. Temayor is also in charge o the definition andimplementation o the master plan. Since thefirst decentralization laws in the 1980s, themayor has been the most powerul leader onurban matters. However, the mayor’s legiti-macy may be questioned in the most deprived

hoods (36.5 percent o poor households in

Zones Urbaines Sensibles — ZUS versus 12.7percent in the cities in general). Illiteracy ratesare 15 percent in ZUS versus an average o 7percent or the whole country.

A Top-Down System with Unequal and

Often Poor Community RepresentationTe PNRU has been based on very stronginteraction between mayors and nationalgovernment representatives. In the PNRU

neighborhoods where electoral turn out is very low.

During the different phases o the projects,municipal authorities were encouraged to

engage local residents through a consultationprocess. How local residents are involved varies rom one city to another, but has ofenbeen limited to simple public meetings. In aew cases, community-based groups devel-oped actions in order to fight the municipal-ity’s plans, and they sometimes succeeded inhaving them redefined. Tese communitygroups generally have not evolved to becomemore enduring orms o representation. Morelocal resident involvement in the process

would have potentially had stronger effects onthe community: more o a ocus on socioeco-nomic matters, a better use o local resourcesand assets, an opportunity to increase civicparticipation, and orms o empowerment thatcan improve education and job opportunities.

Te successive reports on the PNRU6 stressedthat more innovation was necessary in thisarea, and suggested that agencies work in newways along with residents but also with the

mayors and local elected officials.

6 In February 2013, the government released a report marking its

ten-year anniversary (Rapport du Comité Interministériel des Villes du

19 février 2013) identifying a major area where our program could

become more effective: by involving and empowering new actors to

participate in the planning process and even play leadership roles.

In 2014, a report issued after a broad-based consultation among

elected representatives, practitioners, and residents (Rapport de

synthèse de la concertation nationale sur la réforme de la politique

de la ville) conrmed this orientation and demanded the creation of

the conditions for a proper participation of neighborhood inhabitants.

The government mandated an audit of all the associations involved

in these matters in the country (Rapport Bacqué-Mechmache — cf 2).

Figure 3

A public-driven program seeking a better inclusion of private actors and funders. PNRU Program

Funding Sources.

Source: ANRU Annual Report 2013


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Te low socioeconomic results illustratethe program’s inability to engage potentialemployers or economic actors in general(or example, real estate firms or new busi-ness owners). As a result, the increase in jobopportunities or the residents and increasedincomes through the arrival o newcomers hasbeen quite limited.

Te low rate o private investment also reflectsthe act that investors have yet to be attractedto these areas and their new developments.Te €42 billion in public works generated by

the PNRU rom 2003 to 2013 was exclusivelypublic or quasi-public money, coming romdifferent bodies, including national and localgovernments, public housing authorities,and public banking institutions. Tis public

money rarely leveraged private unding. Asiderom the expected private investments that themayor was charged with raising no specificpublic-private partnership (PPP) rameworkhad been implemented or the program.

While the official PNRU evaluation report7 calls or new unding schemes that wouldbetter leverage private unding, the inclusiono local private actors in the initial dynamicsand definition o the project can be consid-

ered a first step. Private actors should beconsidered as potential coounders but aboveall as potential conveners between physicaltransormation and economic impact.

Focusing on the United States:

Why and How?

Looking to the United States or new solutionsmay seem paradoxical. Te urban patterns inFrance and the United States are requently

described as opposite, and a U.S. city in itselis not generally considered an obvious modelin France. In the United States, the publicpolicy context was actually influenced by amajor withdrawal o direct public unding ordevelopment in the 1970s and 1980s. Public

7 « Dix ans de PNRU: Bilan et Perspectives — rapport de la mission

d’évaluation conée au Conseil d’Orientation de l’ONZUS » under

the direction of Malgorn, to the Ministre Délégué à la Ville M. Lamy

March 4, 2013.

unding is still extremely important in France,on the other hand, compared to many othercountries.

Nonetheless, many o the best examples ourban regeneration projects that utilize amore inclusive, community-driven planningapproach are in the United States,8 whereeffective collaboration between the non-profit,philanthropic, private, and public sectors hasbeen critical to successul revitalization strate-gies in many cities.

As the ollowing section illustrates, evena very brie bibliographical review showshow common the French-U.S. urban policycomparison has become.

Background: Documentary Review on

the France-U.S. ComparisonTe interest in a French-U.S. comparison isnot new. In his 2003 book “Faire société, la

politique de la ville en France et aux Etats-Unis”/”Building a society, urban policies inFrance and in the U.S.,” Jacques Donzelot9 compares the French and U.S. approachesto urban policy and community representa-

tion. He points out that the U.S. meaning o“communities” is barely translatable in French.He shows that in U.S. cities, communitiesare ofen identified by neighborhoods. Sucha designation is not commonly accepted inFrance, especially when reerencing ethniccommunities. But Donzelot demonstrates that

8 “l’Enpowerment, nouvel horizon de la politique de la ville”/Empow-

erment, new perspective for neighborhoods transformation, Le

Monde, February 7, 2013

9 with Catherine Mével and Anne Wyvekens

Figure 4

Article in a major French daily newspaper

about how inspirational the U.S. tradition of

empowerment could be for French public

policies.


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the notion o place-based communities inthe United States goes beyond ethnic-groupaffiliations to designate groups that achieve agenuine territorial representation.

Te research work o Frédéric Gilli in 2007,“La politique de la ville aux Etats-Unis, une

perspective française” / “Urban policies inthe U.S., a French perspective,” describes theevolution o the U.S. context. His conclusionoutlines the role o the ederal governmentin shaping the system. From an analysis osuccessive and diverse U.S. programs, hemaintains that initiatives and projects onthe ground result more rom co-productionbetween different levels o decision-making

than rom any kind o strictly top-down orbottom-up process.

“Politique De La Ville: L’expérience Améric-aine” / “Urban Policies: Te American Expe-rience” written by Cyril Cosme, a ormerFrench diplomat in Washington, describes thedifferent stages in U.S. urban policy over thelast 50 years and highlights a ew successulexamples o the development o mixed-in-come neighborhoods. Its official release by

the Centre d’Analyse Stratégique (the primeminister’s think tank) during a symposium inDecember 2012 could be considered an invita-tion or others to look to the United States orinspiration.

Te report “Pour une réforme radicale de la politique de la ville. Ca ne se fera pas sansnous Citoyenneté et pouvoir d’agir dans lesquartiers” / “A radical reform of urban poli-cies won’t happen without us. Citizenship

and empowerment in the neighborhoods,” byMarie-Hélène Bacqué and Mohamed Mech-mache was released in 2014 and was basedon consultation with inhabitants’ associationsall across France. Several o its recommenda-

tions remind me o U.S. practices. Te reportcalls or the empowerment o residents anda better place or them in the democraticprocess, which could lead to neighborhoodtransormation. One o the tools would bethe development o philanthropic action.Another is the role o banking institutions.Te authors underline that this call or newactors to emerge is not a way to justiy oreven to ask or a disengagement o the publicsector. Tey also stress the act that the usualmental ramework to think o social relation-ships in France relies on domination ratherthan collaboration, and that a cultural shifwould be needed in political, institutional, andproessional fields.

Tese conclusions have been debated in thefield o social sciences. In one recent article,10 Tomas Kirszbaum outlines that even i theauthors do not mention the United Statesspecifically in their urban policy proposals, it

nonetheless ofen remains a major influence.Kirszbaum does not contest the interest othis inspiration but is very pessimistic aboutits possible transer to a French context.According to him, the mayors and nationalgovernment have too much to lose in terms

10 « Vers un empowerment à la française ? A propos du rapport

Bacqué-Mechmache/Towards a French style of empowerment ?

Concerning the Bacqué-Mechmache report », la Vie des Idées,

Thomas Kirszbaum, 11/12/2103

o power in a process that would potentiallyredefine what the “common good” in theseneighborhoods might be.

My present research has no ambition to takepart into this scientific debate but will give abetter understanding o the concepts to localpractitioners in France through illustrations otheir implementation.

Precaution: An Impossible

France-U.S. Comparison?Studies show how difficult it is to adapt U.S.practice to a French context, so the compar-ison exercise requires extreme caution. Teollowing outlines a ew key contextual differ-

ences.Te institutional ramework is extremelydiverse rom one state to another in theUnited States, and even one city to another.In terms o local institutions, the absence ometropolitan authorities in the United States(except or transportation) is a significantdifference with France.

Te recent history o many U.S. cities has ledto a very specific urban pattern. Urban sprawl

was encouraged in the 1950s by differentederal policies such as the ederal highwayprogram and the GI Bill and was urtheraccentuated by racial or social differences.During this time most middle class house-holds lef inner-city neighborhoods. At thesame time, ederal urban renewal programsreshaped many inner neighborhoods withnew kind o housing (such as high-rises) and


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inrastructure (highways). Another wave opublic reorms led the ederal government towithdraw money rom many urban initiativesin the 1980s. Unlike in France, U.S. cities alsocannot rely on larger scale financial redistri-

bution or support or resources.

Communities or private investors can alsobe difficult to compare with French counter-parts. Te interventions o private actors inthe public space are much more common andshaped by a very different state o mind thanin France. Philanthropic philosophy is at hearto many o their actions.

Despite these differences, interviews duringmy research showed many shared concerns

between French and U.S. practitioners andpolicymakers. A more sustainable city isofen a denser and more walkable city. Moreinclusive policies and the search or mixed-used and mixed-income neighborhoodsalso seem to be a common concern rom thehighest level11 to communities’ approach onthe ground.

The Choice of the Rust Belt:

Introduction to the Case StudiesSt. Louis, Cleveland, and Pittsburgh are parto the “Rust Belt,” a post-industrial regionstraddling the northeastern and the east northcentral states. Tis region has had to deal withseveral transormative societal and economicissues stemming rom deindustrialization

11 Cf. the new federal approach encouraging collaboration between

the U.S. Department of Housing and Urban Development, the U.S.

Department of Transportation, and t he Environmental Protection

Agency — Partnership for sustainable communities.

including major job loss, social and racialsegregation, and neighborhood abandonment.

Legacy cities are very interesting examples ora European comparison. Tey are among theoldest cities in the United State and despitetheir present situation, they retain a strongurban abric that is similar to European coun-terparts. Te legacy cities could be comparedto the “French Rust Belt” (ormer miningindustry or manuacturing cities in northernand eastern France) or the economic and

demographic context. Tey are also similar tosome Mediterranean cities in southern France

where urban sprawl and racial issues leavethe inner cities partly abandoned or with thehighest rates o poverty.

Te history o these three U.S. cities is remark-ably similar. Tey became some o the mostpopulated and wealthiest cities between themid-19th and the mid-20th centuries. Teirgrowth was led by the development o anindustrial economy that was based on mining,

Figure 5

Historical Population

Source: U.S. Decennial Census


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transport, and manuacturing. Afer reachingalmost 1 million inhabitants at some pointbeore 1950, all three started losing populationdue to a combination o deindustrializationand urban sprawl. However, compared to

other cities, they can still rely on some urbanassets because o the way they were plannedand the way they have developed. Teseassets include housing stock, urban design,historic architecture, and institutions such asmuseums and universities that were devel-oped by philanthropic entrepreneurs.

As post-industrial cities, St. Louis, Cleveland,and Pittsburgh must respond to difficultchallenges with arguably some o the most

interesting new initiatives. Tese cities havebecome places o innovation. Alone, tradi-tional actors such as municipal governmentsare quite powerless to conront most o theseissues, so other actors have to take action aswell. It can start with artists, such as those Imet in St. Louis, finding great places to liveand exhibit or individuals eager to revitalizea ew blocks by acquiring buildings andopening shops. Tese are individual initiativesbut many o them had the sense o helping a

neighborhood or community.

I selected neighborhood-level initiativesbecause they are considered successul exam-ples o revitalization processes, initiated or atleast co-constructed with diverse local actors.Tese initiatives are designed to not onlyenhance living conditions in a neighborhood

but also to bring in new residents and newactivities.12

Te inner city neighborhoods I have chosento examine do not have any U.S. HousingAuthority properties. Teir housing stock ismainly private single-amily owned buildings.Nonetheless, their socioeconomic indica-tors bring them close to most o the PNRUneighborhoods.13 Te difference in the urbanlandscape does not seem to be a method-ological obstacle as it is not the cause o theresidents’ socioeconomic problems. But theseneighborhoods share the common problemso poverty concentration, segregation, andabandonment.14

It may be a paradox to study such a differentsituation, where the problems remain hugeand the proposed solutions can seem ar rom

12 The benets of such strategies are still ercely discussed in

France, as mixed-income areas are not always considered a step

forward to more growth or well-being for the neighborhood and

its original residents. It was nevertheless one of the pillars of the

French public policy through the ANRU. If the debate also exists in

the United States, it is worth noticing that the vast majority of the

actors I encountered in the legacy cities consider this process an

efcient means to revitalize cities. Attracting wealthier inhabitants is

a challenge. It is seen as the only way to enhance pr esent residents’

living conditions. Investing in neighborhoods’ quality of life is consid -ered a way of attracting richer residents and generate new economic

perspectives (residential, services etc...) The resulting gentrication

is a concern but has also been called “a good p roblem to have in this

context.”

13 It is worth noticing, though, that the PNRU also deals with some

inner-city neighborhoods in France, places that have high rates of

abandonment and poverty.

14 However, it might be worth noticing that some of the actors, like

public housing authorities (which predominant in France) will not be

represented in the case studies. Since it is a private market, actors’

economic rationale will play a different role than it would in public

housing neighborhoods. This may account for more involvement of

private actors in general.

Figure 6

Basic Indicators for the Three Cities

Source: U.S. Census 2010. For each indicator, cities are

compared to the national average rate (basis 100).


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the French system. Nonetheless, this researchattempts to learn rom neighborhood revital-ization initiatives in a context where France’smain assets — strong public investment andtop-down planning expertise — do not exist.

Chapter 3 gives a comprehensive overviewo the U.S. model. My analysis is based oninterviews with local practitioners and deci-sion-makers, allowing me to build three casestudies describing the process o multi-actorproject definition and implementation. Teobjective is to make each process under-standable or diverse audiences, to highlightcommon trends, differences, and key successactors beore considering how some o themcould be transerred to the French context.


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T

his chapter presents the three case

studies. Each study rst provides neigh-

borhood background before focusing onthe different stakeholders, their organization,

and motivation for taking part in the revitaliza-

tion process. Both the process strategies and

implementation are described. Each case is

illustrated with stakeholder interactions and an

activity.

Old North St. Louis:

A Strong Community Organization

Old North St. Louis is an example o a neigh-borhood’s revitalization entirely initiated andled by the residents. In particular, it showshow a community is able to build and imple-ment a strategy by itsel, retaining inhabitantsfirst through housing improvements and thenby planning to redevelop several blocks with acomplex mixed-used project to bring in newresidents and visitors. It illustrates how tocombine individual dynamics with a collec-tive agenda, and also shows the acute need tofind partners outside o the neighborhood’sboundaries.

Old North St. Louis:

An Enclave in Northern St. LouisOld North St. Louis is a neighborhood locatednorth o downtown with about 2,000 inhabi-tants. It used to be a popular and industriousneighborhood, inhabited by various ethnic

communities, especially workers rom EasternEurope. In the 1950s, the construction o

the Mark wain Highway physically dividedthe community, separating residents romnearby commercial areas. While Old Northhas always managed to conserve its identitybased on a variety o people rom differentbackgrounds, it encountered a tremendousloss o population and an alarming wave o

Three Neighborhood Revitalization Initiatives in the Rust Belt

St. Louis

• Located at the Missouri and Mississippi

conuence, played a crucial role in rivercommerce.

• Heavily touched by urban sprawl. Since

1950, the metropolitan area has gained

200,000 residents even as the city lost

500,000.

• The city is increasingly segregated, with

the North Side concentrating the Afri-

can-American population.1

• For decades, red-lining from lending

institutions and racial issues prevented

new investment in large swaths of thecity. This under-investment has resulted

in alarming data, such as a 19 percent

vacancy rate and a 27 percent house-

hold poverty rate.

1 http://www.nytimes.com/interactive/2013/11/17/us/a-di-

vided-st-louis.html. This article from The New York Times shows

interesting data to compare the North Side with the rest of the

city. It also focuses on the negative aspects of the neighbor-

hood’s reality without shedding light on collective initia tives

there.

Figure 7

St. Louis Basic Indicators

Source: U.S. census 2010 and HUD 2011

http://www.nytimes.com/interactive/2013/11/17/us/a-divided-st-louis.htmlhttp://www.nytimes.com/interactive/2013/11/17/us/a-divided-st-louis.htmlhttp://www.nytimes.com/interactive/2013/11/17/us/a-divided-st-louis.htmlhttp://www.nytimes.com/interactive/2013/11/17/us/a-divided-st-louis.htmlhttp://www.nytimes.com/interactive/2013/11/17/us/a-divided-st-louis.html


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vacancy. However, the most recent censusdata (2012) showed a demographic increaseor the first time in the neighborhood. Tishas been linked to a long-term effort by thelocal community to maintain and bring back

residents through a variety o interventions.

Old North St. Louis Restoration Group:

A Close-Knit and Active Community-

Based OrganizationOld North St. Louis Restoration Group(ONSL) was officially created in 1981, inspiredby similar groups’ activities elsewhere in thecity. As a community development corpo-ration, the group is able to intervene on realestate preservation and development, but ithas always been conscious o the simultaneousneed or community building and organiza-tion.

Te neighborhood’s revitalization was theinitial purpose or the group’s creation. Tebelie was — and still is — that there was apriceless value in preserving both the neigh-borhood’s buildings and the people who livethere. In a context o abandonment, thesebuildings were assets or the uture as they

could be magnets or newcomers. Motivationswithin the group were diverse, ranging roman appreciation or architecture, to amilieswho had been there or several generations,to people who just wanted to rehab a propertythat they could afford to buy, to a group roma Presbyterian Church who had all movedtogether in the late 1970s as urban pioneers.Altogether, they succeeded in stopping a

Figure 8

St. Louis Neighborhoods.

Source: Dan Brassil


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new highway project in the neighborhood inthe late 1970s. Tis gave the neighborhood’shouseholds some cohesion and a strongawareness o their collective power in deci-sion-making.

During its first three decades, the group was volunteer-based. An executive director wasfirst hired in 2001. Te group today has threepermanent staff members, and this staff takesorders rom a 16-member elected board.Tough there is no ormal requirement, everyboard member is a resident o the neighbor-hood.

ONSL has to find its own financial resources,though a consultative board including local

leaders is supposed to help with technicalsupport and undraising.

Using Local History as a Strategic

Asset for the Future

Te strategy or the neighborhood has beenentirely defined and implemented by ONSL

since its creation. Te goal has been toredensiy the neighborhood by attracting theresidents necessary to make the area sustain-able or a critical mass o local retail andservices. Te value o the built environmentand the neighborhood’s long-standing tradi-tion o social diversity have been the strategy’spillars. Its physical (architectural legacy, urbangrid) and social (relatively mixed and active

What is Community Development Block

Grant (CDBG)?

• Federal program enacted in 1974

through an annual budget allocatment

formula to states, counties, and cities

(above 50,000 inhabitants). Granted

with only general provisions as to the way

it is to be spent.

• Supports local government to target

decent housing, living environment, and

economic opportunities. All projects are

required to meet at least one of three

national objectives: benet low and

moderate income persons, prevent or

eliminate slums or blight, and address

urgent community development needs.

Grantees therefore have a high levelof discretion over activities, which can

include everything from infrastruc-

ture and housing repair to community

services, and municipalities have a

wide autonomy as far as their allocation

within the city. In St. Louis and Cleveland,

the same amount is given to each city

councilmember who is in charge of deci-

sion-making for each neighborhood.

• CDBG is usually praised as a very

“bottom up” mechanism, as states andlocalities are best able to decide what is

best for their communities.

• The program represents approximately

$3 billion in the federal government’s

2014 budget, but this amount has been

decreasing since its creation in the

1970s. Consequently, the program is

less and less able to meet needs.

What is a Community Development Corporation (CDC)?

• Created in the late 1960s, they are an attempt to provide an institutional response to a civil

society demand for better representation. This demand is a reaction to previous top-down

urban renewal policies, and it is also strongly connected with the civil right movement and an

attempt to respond to discontentment in deprived neighborhoods.

• Non- prot organization incorporated to provide programs, offer services, and engage in activ-

ities that promote and support community development: economic development, education,

health, community organizing, and real estate development. Since the 1980s, CDCs have

increasingly specialized in affordable housing production, from land controlling to housing

building, repairing, and renting.

• Usually serves a specic location and focuses on serving lower-income residents or struggling

neighborhoods.

• Has a exible framework with a board composed of local residents, associations, and some-

times businesses representatives. Many rely on either professional staff or volunteer work but

often a combination of both.

• Various sources of funding: foundation grants and donations, federal subsidies, tax incentiveprograms, and rental fees from housing programs. Funding is used for both executive budget

and activities and program implementation.


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community) qualities would allow Old Northto become a vibrant urban community again,i they were maintained and reinorced.

Stabilizing the CommunityOne o the main goals at first was to stabi-lize the neighborhood and make sure thatthe remaining residents would not leave. oaccomplish this, ONSL developed five fieldso community-building activities: communityorganizing and leadership, home maintenanceand financial literacy, environmental health

and saety, neighborhood stabilization, andhistoric preservation.

Because one o the primary objectives was

to avoid gentrification, helping the poorestto cope with immediate financial difficultieswas a priority. Another aspect o stabilizationwas working on a common local identity bywriting a meaningul local history, in whichevery resident could take part. Te designa-tion as national historic district was an essen-tial step. However, residents also worked withstudents and proessors o the University oMissouri-St. Louis in order to create a collec-

tive narrative about the past. Tis narrativecreated additional cohesion in the neigh-borhood, since every kind o resident couldrelate to it whatever their race, social group, orneighborhood status.

In terms o built environment, stabilizationmeant immediate repairs on buildings toprevent them rom collapsing. Investors didnot want to see market value depreciate andwere thereore willing to take part in thegroup’s collective efforts through volunteerwork.

Planning for the Future

Te second step afer stabilization was to ocus

on enhancing the urban environment in orderto attract newcomers. Trough the 1990s,there was a growing sense that the communitywas stable enough to think o the uture, socollective action should become more struc-tured. Residents started acquiring some build-ings rom the city’s landbank and began todevelop a planning process. Te ONSL boardoutlined the first planning actions in thelate 1990s; they were soon helped by a smallproessional staff but lacked external support.

Te group’s three-year plan ocused first onthe revitalization o one o the neighbor-hood’s main streets, North Market Street. Tismarked their transition rom the stabilizationo individual buildings to the stabilization oentire streets and neighborhoods. It meantrecreating an active streetscape, and or that,attracting new partners to build new houses inthe area. Tese real estate activities led themto really think o their group as a CDC.

Figure 9

ONSL Executive Budget 2013: $190,000


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Building Partnerships to Develop

and Promote the Neighborhood

On this first project, ONSL partnered withRISE, a non-profit organization that is a devel-oper o affordable and market-rate housing.Its budget comes rom a mix o support romlocal banks, oundations, and local and ederal

government agencies. In contrast to ONSL, ithas access to pre-development unds. radi-tional developers were araid to build in aneighborhood that was still losing population,but RISE accepted the challenge.

ONSL had a complex role: On one hand itwas still working with residents to develop aplan, but on the other hand, it was adoptingthe rationale o a developer when choiceswere required. Moreover, or the first t ime,the strategy had to be shared with or adaptedto an external partner. For example, RISEinsisted on revitalizing more buildings thaninitially planned in order to get rid o a ewabandoned sites that tended to righten poten-

tial investors.Te strategy then shifed rom maintaininghousing stock to reopening retail stores. Teidea was to attract visitors as well as newresidents. A strategy ormed to use CrownCandy, an old-style restaurant had remaineda historic destination or the entire city, as amagnet to encourage visitors to spend moretime in the neighborhood. o do so, ONSLand RISE decided to reopen the Crown Squareproject, a pedestrian mall that had been closedor decades, and turn it back into a commer-cial district.

Te partnership with RISE presented severaladvantages. It led to connections with nationalorganizations having pre-developmentfinancing, such as Enterprise Community Inc.It also demonstrated that ONSL had partnerswith capacity and resources or this kind o

project. Tis had indirect impacts on realestate values in the neighborhood.

Crown Square: The Redevelopment of a

Long-Abandoned Pedestrian Mall

Formerly a vibrant neighborhood commercialdistrict, North Market Street was replacedwith a concrete pedestrian mall in the late1970s. Tis ailed to attract shoppers, so itwas closed a ew years later, which createdbarriers to neighborhood connectivity andhad a chilling effect on the local real estatemarket. Afer the first new houses were builton North Market Street, the communitywished to see this street reopened. Trough acommunity-based planning effort, the resi-dents asked or a mixed-use development withboth residential and commercial spaces. Tegoals were to attract more visitors through arenewed retail area and make them changetheir opinion about Old North (and maybeNorth St. Louis), to enhance the “walk-ability” o the neighborhood, and to maintaineconomic and social diversity in the commu-nity.

Te program included:

• a complete historic rehabilitation o 13buildings on the two ormer pedestrianmall blocks, coupled with the construc-tion o 14 residential buildings adjacent tothe mall area. Tese included 80 green-built mixed-income residential rentalunits on and off the ormer pedestrianmall (lofs, apartments, and live/work

Figure 10

Main landmarks in the revitalization process

of Old North St. Louis

1950s-1970s

• Mark Twain Highway construction

• Population loss, abandonment, and

crime increase

1970s

• Neighborhood begins to organize

1981

• Dreation of Old North St. Louis Revitaliza-

tion Group

• Designation as a national historic district

1990s

• Work on the local history

• First planning process

• Adoption of CDC structure

2001

• First hired staff

• North Market Dtreet masterplan

• Construction of rst few houses in the

neighborhood

2008-10

• Crown Square project

• Reopening of main commercial street


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spaces), and approximately 33,000 squareeet o commercial space.

• the reopening o 14th Street to vehiculartraffic, reconnecting this local commercialdistrict with the surrounding neighbor-hood. Te development included pedes-trian lighting, public green spaces andlandscaping, and a small plaza.

ONSL had a double role in the process,leading up a community-based planning effortand acting as a co-developer o the projectthrough a partnership with RISE to purchaseproperties on or near the ormer mall, which

soon became known as the Crown Squaredevelopment, and directing its redevelopment.

ONSL’s reputation gave it good standingor negotiating with landowners: its goal oredevelopment with no displacement wasclear since the group was advocating or thecommunity’s interests o cohesion. Its limitedfinancial resources were also well known.However, its legitimacy as well as its wise useo the financial tools it did have allowed it tobe more successul than previous developersin acquiring the buildings.

Tanks to its expertise, RISE was able to puttogether different private unding includinga pre-development loan to begin a process oassembling the ownership o all these prop-erties. It was imperative or them to acquire

enough “critical mass” to ensure a major redevelopment impact, and to ully address the

What are Tax Incentive Mechanisms?

The federal government gives indirect

support to urban revitalization efforts

through tax credit mechanisms. Dedicated

to affordable housing creation or renova-

tion (Low Income Housing Tax Credit) or

targeted at business or organizations located

in low-income communities for community

or economic development (New Market

Tax Credit), these mechanisms encourage

the participation of private investors in the

process. If tax credits are granted by the

federal government, each state is tasked with

choosing relevant projects to be funded. The

developers or groups with selected projects

benet from a tax credit that they redistribute

to potential investors (mainly corporations).

Intermediary organizations, sometimes called

syndicators, connect investors with the proj-

ects and their initiators.

With regards to housing rehabilitation, both

federal and local governments are able to

give historical tax credits in eligible areas.

These different mechanisms can be comple-

mentary sources to CDBG and other funding

sources.

For details on different tax incentive

programs see Annex 3.

Figure 11

Crown Square Sources of Funding


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redevelopment needs o the ormer pedestrianmall and the streets flanking it. ONSL andRISE became co-owners o the development.

Te unding or the $36 million project wasincredibly complex. It utilized an array otax credit equity, tax-exempt bond financing,conventional bank financing, and other incen-tives in a sophisticated financing structure.

Tough the municipal government expressedits support or the initiative, its role remainedconfined to allocation o CDBG unding,zoning adaptation, and unding o the publicspaces, which did not represent a strong

commitment and/or monitoring rom publicinstitutions.

Te project was completed in 2010 despite thedifficult context o the 2008 real estate andfinancial crisis and is a beautiul complex o

rehabilitated and used buildings. Tough mosto apartments are rented, some o the retailstores are still vacant.

Tis 30-year long story is a very impressiveexample o a group’s empowerment andaction, and ability to solve issues no oneelse was addressing. Te group defined andimplemented their own solutions in a diffi-cult context where there was no other broad vision. Te comprehensive initiative tacklesthe built environment, economic develop-ment through retail, and above all commu-nity building. Recent population gains in theneighborhood can be attributed to the ONSLgroup’s energy and strategic planning, and

its capacity to find a solid partner. Tis is acompelling example o successul bottom-upprocess.

Nonetheless, it is important to stress the limitso this story. ONSL is leader o the process,which gives it strength but also orces it toconstantly renegotiate financial, technical,and political support rom different publicand private unders. Te process is long anddifficult because o scarce and uncertainfinancial resources. It also suffers rom isola-tion because it does not have strong municipalguidance. Te local initiative would likelybenefit rom long-term municipal involve-ment, and a successul scaling up would haveobvious benefits or the city as a whole.

Figure 12

Tax Incentives in the Crown Square Redevelopment, in $

Source: Old North St. Louis Restoration Group


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University Circle Cleveland:

A Strong Foundation, Some Committed

Partners

As active as a community group like ONSLmay be, it still needs partners to have a widerinfluence, which is not always simple toachieve. Other kinds o place-based partner-ships exist that can have stronger and largerimpacts on neighborhoods. University Circle

in Cleveland is one such example. Here, agroup o long-rooted institutions put theirresources together and dedicated them to thesurrounding neighborhoods. In doing so, theydeveloped a new approach to the revitaliza-tion process. Tis required major organiza-tional changes and a neutral convener able topush and help implement this strategy. TeCleveland Foundation was able to play thisinnovative role.

The University Circle:

A Legacy from the Time of MillionairesIn Cleveland, University Circle remains anisland o stable institutions surrounded bysome o the most distressed neighborhoodsin the city. Nearby neighborhoods such asFairax, Glenville, and Hough suffer rom highunemployment, poverty, and vacancy levels,and lack basic amenities.

Traditional Actors with New Purposes:

From Awareness to Strategy Conronting this situation, some local actorsdecided to develop a new strategy by them-selves, a strategy inspired by the role tradi-tional institutions had started to fill in otherpost-industrial cities. Te Cleveland Founda-tion had a decisive role to fill in Cleveland.

Cleveland

• Experienced tremendous demographic

growth with the creation of the Erie Canal

between Ohio River and Great Lakes,

and soon became a major manufacturing

center.

• From the 1880s to the 1930s, corporate

and civic leaders founded several major

public institutions (museums, schools,

health amenities) in a vast green area

that became University Circle.

• From the 1960s onward, different factors

— economic decline, suburbanization,

and racial riots — led to racial segrega-

tion, abandonment, and impoverishment

in parts of the city, especially the eastern

neighborhoods.

Figure 13

Roles of the Different Actors in the Crown Square Redevelopment Process


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University Circle InstitutionsTere are 19 institutions located in theUniversity Circle, among them Case WesternReserve University (created in 1880), Cleve-land Institute o Art (1890), ClevelandMuseum o Art (1916), the botanical gardens(1920s), Cleveland Clinic (1921), and Univer-sity Hospital and Severance Hall (1931).

Among the wealthiest institutions, ClevelandClinic has a $6 billion operating revenue15 andCase Western Reserve University, a $1 billionoperating budget or 10,000 students.16 Tesenumbers should be compared with the $2

15 “State of the Clinic 2012” total revenue increased by 7 percent to

$6.125 billion in 2012.

16 “Budget Book 2015” CWRU (between 2010 and 2015, the annual

revenue has been constantly increasing from $900 million to $ 1

billion).

Figure 14

Cleveland Neighborhoods.

Source Livecleveland.com

Figure 15

Basic Indicators for Cleveland

Source: U.S. Census 2010


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million annual budget o the city o Cleveland.Moreover, these institutions have a total o60,000 employees, o which only 7.5 percent(4,500) live in the adjacent neighborhoods.Many o them attract students, employees, or

visitors rom beyond the city’s boundaries,and even rom overseas.

For decades, these anchor institutions havebenefitted rom a “community service corpo-ration” called University Circle Incorporatedthat is paid or through a shared member-ship. A mix o CDC, chamber o commerce,

and special improvement district, this orga-nization provides services to the area thatthe municipality cannot afford but that theinstitutions expect (including landscaping andsecurity).

Nonetheless, these anchor institutionshave long been disconnected rom theirsurrounding neighborhoods, which them-selves have unequal organizing capacity. Someo them, like Fairax, can count on a very

strong CDC committed in a long-term part-nership with Cleveland Clinics. Others such asHough do not have a CDC at all. As povertyand vacancy rates increased in the neighbor-hoods throughout the 1970s and 1980s, theinstitutions started to be negatively affectedand they began to struggle more and more toattract employees, visitors, and students. Tisis how they realized that their national andinternational development also depended on asustainable local environment. At some point,

driven not only by charity but also by neces-sity, the institutions began to act outside otheir boundaries. Teir first attempts duringthe 1990s largely ailed because o a lack ocoordination and the difficult o actuallyreaching local communities.

The Cleveland Foundation: An Occasion

to Go Beyond its Traditional Role

Established in 1914, the Cleveland Foundationis the world’s oldest community oundation,and has a rich tradition o investing in urban

matters and community improvement. In the1930s, it helped lead the slum-clearing andplanning the nation’s first public housing. Inthe 1960s, it launched an initiative to tacklehousing, employment, and educational dispar-ities between black and white populations.In the 1980s, it helped with the emergence o“community development corporations” toinvigorate Cleveland’s neighborhoods. Sincethe 1980s, it has engaged in the reinvestmentin Fairax, Hough, Central, and other east-

side neighborhoods near University Circle.Its portolio includes a ocus on a wide rangeo potential interventions to tackle commu-nity priority areas: economic transormation,public improvement, development, neighbor-hood revitalization, and art advancement.

In 2010, the oundation had $1.8 billion inits endowment, $85 million in grantmaking,and more than $40 million in new gifs.In an average year o $80 million in grant-

making, hal o this amount is donor-oriented,meaning that the oundation specifies what todo with their money. Te other $40 millionis more flexible; it used to be completelycommunity responsive, meaning that thecommunities defined their own needs. But orthe past 10 years, hal o it has been dedicatedto strategic initiatives decided at the discretiono the oundation board. Te oundation has

What are Anchor Institutions?

• Non-prot institutions that, once estab-

lished, tend not to relocate. This includes

universities, hospitals, and museums.

• Surpassed traditional manufacturing

corporations to become their region’s

leading employers in the wake of the

decline of manufacturing, rise of the

service sector and mounting government

scal crises.

• Economic power of universities can

produce targeted community benets.

Examples of anchor institutions strate-

gies in different cities:

◆ Catholic Healthcare West, a largehospital in San Francisco, has provided

low interest rate loans to non-prot

organizations to make community

investments since 1992.

◆ The University of Pennsylvania hasshifted over 10 percent of its annual

expenditures to local purchasing,

injecting an estimated $80 million into

the local economy in 2006-07 alone.

◆ The Henry Ford Hospital in Detroitprovides incentives to managers to

hire locally and has a favorable policy

for local vendors.


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the motivation and the ability to work wher-ever it wants, with local partners and espe-cially with local communities.

One o these efforts is the Greater UniversityCircle Initiative (GUCI). In 2005, the ounda-tion realized that the institutions in the areahad planned new developments and unded

$3 billion o growth in the next ew years,which was an unprecedented opportunityto make the University Circle attractive ornew residents, but only i this investment alsobenefited the neighborhoods surrounding the

institutions.

Te GUCI has been a way or the ounda-tion to shif away rom its traditional role oacting in a responsive way at a small scale. Teinitiative ocus area is our square miles andincludes portions o the surrounding neigh-

borhoods (including Fairax, Glenville, andHough). It had the opportunity to intervenein a whole swath o the city, overcoming eachactor’s typical geographical limits (UniversityCircle, other CDCs). In a context like Cleve-land’s, the oundation was the only actor ableto develop a multi-neighborhood strategythanks to its legitimacy and its financialcapacity. As the below chart shows, the oun-dation has had a tremendous direct financialimpact on the strategy.

The Greater University Initiative: Turning

National Actors into Active NeighborsTe rationale o the Cleveland Foundations’strategy has been that the success o theinstitutions could affect the area beyond thelimits o University Circle, and attract moreinvestment, residents, and visitors to revitalizethe economy o the entire city. As in St. Louis,one goal o this initiative is to attract and

retain higher income visitors or residents tothe deprived neighborhoods; another goal isto simultaneously stabilize the neighborhoodsand their present residents by offering thembetter opportunities. In addition, the GreaterUniversity Circle Initiative uses institutions’resources to reduce the gap between richand poor adjacent neighborhoods, trying toensure that the positive dynamics will benefitto the whole area. Te GUCI thus uses tradi-

What is a Foundation in the United States?

• Four different types of philanthropic foundations in the United States:

◆ independent foundations are generally established by individual donors or donor families

◆ operating foundations primarily run their own programs but can also make grants

◆ corporate foundations are established by businesses, from major corporations to familybusinesses

◆ community foundations raise funds from the public. They engage in grant-making primarily

in a dened geographic area. Community foundations in the Midwest account for a largershare of grant-making than in other U.S. regions

In the Midwest, foundations mostly originate from a philanthropic tradition developed by the

wealthy entrepreneurs of the 19th and early 20th centuries.

• In 2011, the United States had 81,777 foundations with a total of $622 billion in assets.

They distributed $49 billion, an amount estimated to have reached $50.9 billion in 2012, a

number that has been increasing since the early 2000s. The median grant amount in 2011

was $28,000.

• Foundations have complete exibility to deter-

mine the conditions — the “what, who, where,

and how” — of their grant-making activity.This activity can take form of general support,

program support, capital support, research,

and so on. Health (28 percent of grant dollars)

and education (20 percent) are the top priori-

ties of the country’s largest foundations. More

than one-third (35 percent) of all grant dollars

awarded by the nation’s largest foundations are

specically intended to benet the economically disadvantaged.

• Source: The Foundation Center


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tional physical redevelopment but also targetseconomic change. Te Cleveland Founda-tion initiated this strategy, but it has alwaysintended to develop it in a collaborative waywith the institutions themselves.

Empowering Actors and Convincing

them of their Collective Power

According to the Cleveland Foundation,previous attempts had been made beoreGUCI but they suffered rom either atop-down approach or an inability to buildcollaborative partnership with the residents.Te oundation worked to encourage anchorinstitutions and residents to participate inneighborhood renewal.

Beore launching the GUCI, the oundationmet with surrounding CDCs, communitygroups, and elected officials to “gauge thework o these entities and determine howtheir goals overlapped or could inorm eachother’s goals.”17 Te discussion embraced bothphysical development and initiatives as meansto rebuild the area’s economy. Te mappingexercise to overlay the uture developmentplans o all CDCs and anchor institutions

on a single map was completely new, and itturned out to be a decisive tool as it showedthe transormative potential o a collaborativeapproach.

Even i some o the anchor institutions werealready convinced that they had to helpthe surrounding neighborhoods, they still

17 Extract from « Cleveland’s Greater University Circle Initiative,

Building a 21st Century City Through the Power of Anchor Institution

Collaboration », Cleveland Foundation 2013.

were not aware o their collective power asneighbors. In order to turn multiple anchorinstitutions’ initiatives into an anchor districtstrategy and make it more efficient, institu-tions were encouraged to share a common

strategy. Since the collaboration has beenbased on a flexible and voluntary partnership,instead o a legal contract, it requires constantattention to maintain cross-cutting interests.For each o the projects, one institution isdesigned as a “champion” leader or its imple-mentation.

Designing Tailor-Made Governance

Te GUCI strategy ocused both on institu-tional partnership and community engage-

ment. Consequently there was a need or acomplex ramework and efficient stewardship.Te Cleveland Foundation was the rightpartner to assume this role. First, it was able toact as an ”honest broker” to represent all theinstitutions. Second, the health o the neigh-borhoods ell into its core mission, and manyneighborhood representatives already knewand supported the oundations’ role. Finally,it could provide seed unding to leverage bothprivate and public money.

Using Area-Targeted Strategies, Both in

Housing and Employment, Strengthens

Local Neighborhoods

Different tools have been used to bringtogether University Circle and the adjacentneighborhoods, through physical redevelop-ment and economic inclusion. First, a physicaland unctional pathway was developed to

connect neighborhoods with anchor institu-tions through new development on ormerlyunderutilized land on one o the edges o theanchor institution district. Tis new neighbor-hood is known as Uptown. Initially planned as

an extension o CWRU’s campus, it evolved tobecome a major project with a wider impact

Figure 16

Main Landmarks in the Revitalization

Process

1960s

• Creation of University Circle Inc

1990s

• Anchor institutions make rst attempts to

reach out to surrounding neighborhoods2005

• Greater University Circle Initiative

creation by the Cleveland Foundation

2007

• Launch of GUCI housing and economic

initiatives

2010

• Opening of the rst Evergreen Coopera-

tives

• Opening of the Newbridge Center

2012

• Uptown mixed-used development phase I

is completed

• Opening of the MOCA

2013

• Uptown phase II is initiated

• Ground-breaking for other projects

including transportation


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or GUCI’s goals. Its program includes newhousing (mainly rental apartments), new retailoptions or the students and residents, andinvestment in cultural institutions (such as theMuseum o Contemporary Art) that would

attract or retain new residents or visitors inthis part o the city. CWRU’s role was criticalto bringing the project to ruition, as it hadbeen the initiator, the convener o the designcompetition, and the assembler and initialowner o the land. Te Cleveland Foundationplayed an important part by unding bothplanning works and capital investment. Tecoordination with Greater Cleveland Regionalransit Authority also allowed the develop-ment to be combined with periodic enhance-

ments in the public transportation system.Te developer MRN.ltd, who had alreadybeen successul in a major street redevel-opment downtown, took charge o the twosuccessive phases.

Second, the Cleveland Foundation helpedanchor institutions design common incen-tives to encourage people to live, buy, and hirewithin the neighborhoods. Major employershave been invited to tighten their links with

the local workorce through job and trainingopportunities.

Tere is a strong interest in these complemen-tary approaches. Physical redevelopment hassignaled a change or investors and visitors tocome to the area.18 Te economic approach is

18 According to the Cleveland Foundation, it had to have “sufcient

community appeal and clarity of purpose to attract outside funding;

be executable in a short period of time.” Cleveland Foundation

more local, but it nonetheless requires deepshifs in the priorities and internal operationswithin the institutions.

Live, Buy, and Hire Local

Tis second aspect o the strategy, the mostinnovative compared to French public policy,is the ocus on the economic impact localactors can have in a neighborhood’s revitaliza-tion.

• Live Local: All major employers in thearea give employees financial incentivesto live near their work in order to helpbuild greater income diversity in thesurrounding neighborhoods. Even so,

in 2012, only 4,500 GUCI employees (5percent) lived there. Incentives includehome loans, exterior improvement unds,and rental assistance. Te programpredated GUCI, but has now expanded toallow or better inclusivity.

• Buy Local: In 2012, the GUCI institutionsspent only 28 percent o their combined$3 billion in purchasing in the county. Temajor obstacle to local procurement wasthe absence o local businesses, so GUCItargets the creation o small enterprises inthe neighborhood. Te objective has beento capture some o the local buying powerto build local wealth in the surroundingarea. wo examples o these outcomesinclude Evergreen Cooperative Laundryand Evergreen Energy Solutions. Eachbusiness serves specific needs o theinstitutions. For example, the veterans’

association hospital voiced a need or agreen, industrial-scale laundry service. Aninitial client is critical or the first yearso operation, afer which it is envisionedthat the businesses will eventually be able

to serve clients outside o the GreaterUniversity Circle.

Te cooperative model is supposed to be away to make sure that this wealth creationbenefits the local employees and remainsin the area. For instance, the Evergreen

Figure 17

Evergreen Laundry Cooperative Financing,

in $ Million

Source: Evergreencooperatives.com1

1 “The Evergreen Cooperative Development Fund is the nancial

tool for the program. It targets its investments at start-up Cleve-land-based employee-owned companies, with a focus in under-

served industries and neighborhoods. Its rst geographic target

is the Greater University Circle Area. It has raised funds from the

Cleveland Foundation and different local institutions — C WRU,

Cleveland Clinic, University Hospital. In addition to economic

returns, its declared aims are “to create new, living wage jobs

and promote asset accumulation for neighborhood residents; to

anchor capital within the neighborhoods in order to jumpstart

more local economic activity; to build viable, locally owned

economic enterprises that can help stabilize the neighborhoods;

to ensure income diversity and permanent housing affordability

in the area.”


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provide workorce training services toyouth and adults. Te institution offersspecialized training scholarships based onthe hiring needs o anchor institutions,places trainees in jobs, and mixes young

people with adults to encourage the devel-opment o role models. Te oundationopened the center in 2010 and is one oits main unders, along with other localmedical institutions, banks, and ounda-tions.

Laundry employs nearly 30 persons livingin the Greater University Circle andexpects to support 50 when it is at ullcapacity. Te businesses pay a minimumwage o $10.50 an hour, and also pay a

portion o profits in order to train newcommunity leaders. Tey will hire romwithin this pool whenever possible.

• Hire Local: Te Cleveland Founda-tion created a new acility called theNewbridge Cleveland Center or Arts to

Te premise o the Greater University CircleInitiative is to turn a series o individual inter-ests into a collective goal. Tis example showshow to use local resources and turn theminto assets or residential development, social

inclusion, and economic growth in a largerpart o the city.

Te Cleveland example shows that the processalso needs a convener that is able to shapea process in which individual strategies willmerge into a broader purpose. In this case, theCleveland Foundation successully fills thisrole.

At the same time, this example raises thequestions o the legitimacy o a large-scale

strategy where the municipality is hardly parto the definition or implementation process.Te different institutions, including the Cleve-land Foundation, must take charge o someareas and problems that the municipalitycannot conront because it does not haveenough resources.

Te initiative already has measurable impactson some o the institutions. For instance,the number o students applying to Case

Western has increased since Uptown has beendeveloped. Still, the impact on the adjacentneighborhoods remains quite low in termso absolute numbers o employees in theEvergreen Cooperatives and the number oemployees that have taken part in the livinglocally program. However, GUCI is notconsidered to have reached its ull potentialyet. Te GUCI strategy involves communitybuilding activities that are still in progress,

What is the Community Reinvestment Act?

• Federal law passed in 1977 to reduce discriminatory credit practices against low-income

neighborhoods. Known as redlining, these practices generally took place in predominately

black inner city neighborhoods and paralyzed the local housing market, lowered propertyvalues, and encouraged abandonment.

• Encourages commercial banks and savings associations to help meet the needs of borrowers,

especially for low- and moderate-income neighborhoods.

• Federal regulators review banks’ performance and give them a rating. They lead an audit on

an assessment area, which depends on the banks’ branch locations. Regulators expect the

bank’s lending performance to mirror the demographics of the assessment area. Evaluation is

based on the percentage of loans in low- and middle-income areas and to low- and middle-in-

come individuals. Market performance is also taken into consideration. Activity is tracked and

reported by census tract.

• Large banks — dened as total assets of at least $250 million or afliates of holding compa-

nies with $1 billion or more — are evaluated in three areas:◆ lending to small business, individuals, and for community development

◆ investment, including community development investment, mainly through the tax creditsystem (HTC, LIHTC, NMTC)

◆ service or specic products dedicated to low and middle-income individuals or areas ortraining or services offered to the community

• Resulted in over $65 billion in community development loans in 2013 in the United States.1

1 source: “Findings from analysis of Nationwide Summary Statistics for 2013 Community Reinvestment Act Data Fact Sheet,” Federal Finan-

cial Institutions Examination Council, August 2014


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and some o the neighborhoods do not yethave a proper CDC to represent them at nego-tiations.

East Liberty Pittsburgh:

A Strong Broad-Based City Leadership

Philanthropy can play a major role in findingand unding local actors to achieve localtransormation. A major actor makes theseinitiatives more successul. Nevertheless, asefficient as place-based initiatives can be, theirlegitimacy and their impact remain limited

i they are not able to work toward a broader vision. Te East Liberty example shows howcoordination between three main actors hasbeen critical to ensure successul revitalizationat different scales. It illustrates the efficientcombination o a long-term strategy sharedby economic and academic leaders throughthe Allegheny conerence, a city governmentdetermined to use its tools voluntarily, and thespecific capacities o a CDC (here the ELDI –-East Liberty Development, Inc.), all workingtoward the same goal.

Figure 18

Roles of the Different Actors in the GUCI Process

Pittsburgh

• One of the most economically vibrant

U.S. cities in the 19th century, largely

based on the steel industry.

• Important magnet for immigrant workers

and home to famous entrepreneurs like

Carnegie, Frick, the Mellons, and Heinz

during the industrial era.

• Philanthropists launched education, arts,

or health programs for their employees

and built amenities such as libraries,

museums, schools, and universities in

order to support them.

• Local assets, particularly foundations,

became a signicant resource for the city

as it attempted to overcome the collapse

of local industries in the 1980s.

• Shelters a huge high tech cluster but has

also signicantly enhanced quality of life

during these last few decades.

In Pittsburgh, city leaders, politicians, busi-nesspeople, and academics have recognizedthat the long-term economic health o theirregion relies on a high-quality urban environ-ment. Te collaboration o these actors dates

back to the height o the city’s prosperity. Itcontinued through the region’s economiccrises in the 1980s, when it acted to jump-start the local economy while supportingthe conditions or bottom-up initiatives thatwould revitalize disadvantaged neighbor-hoods through a series o strategies and tools.Tis top-down long-term strategy or the city— and even the region — allowed or strongerand more coherent community-based efforts.


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East Liberty

empowering neighborhood revitalization: lessons for france from three u.s. cities

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